Moscow warns of retaliation after G7 decision to use frozen Russian assets for loan to Ukraine

The Russian foreign ministry has warned that leaders from the Group of Seven countries will face “painful” retaliatory measures following their decision to loan money to Ukraine using profits from frozen Russian investments.

The agreement to provide Ukraine with $50 billion from Russian assets “will not lead the West to anything good,” Russian foreign ministry spokesperson Maria Zakharova said during a news conference in Moscow on Thursday. 

Zakharova called the agreement an “illegal initiative” that “threatens to completely unbalance the financial system and create cataclysmic crises.”

“There is enough European property and money in Russia … and inevitable retaliatory measures will be extremely painful for Brussels,” she said.

More on the agreement: The loan will be drawn from funds frozen by Western leaders in the wake of Russia’s invasion of Ukraine in 2022. While just $3 billion in frozen funds is located in US banks, a much larger share, adding up to hundreds of billions of dollars, is located in banks in Europe.

Negotiators have focused on a loan amount of about $50 billion.

The loan is expected to be delivered by the end of 2024, which would ensure the money would get to Ukraine before a potential change in US presidents. President Joe Biden is facing off against former President Donald Trump in November’s US presidential election, and Trump has refused to commit to sending additional funding to Ukraine.